Why Thriving Private Sector Businesses Need to do More to Support Economic Recovery
The saying goes, ‘we’re all in the same storm, but we’re not in the same boat’, and this has never been more true than when observing the impact of Covid on UK businesses. While some sectors, such as grocery, telecoms, IT and eCommerce, have been unaffected - or even thrived during the pandemic - other industries such as manufacturing, hospitality, automotive and travel are struggling or have all but ground to a halt.
If you’re one of the lucky ones, it’s tempting to keep your head down, stay quiet and leave it to the government to support those in need, but in the long term, this will be bad for you and the economy at large.
Six degrees of separation
If Covid has taught us one thing, it’s that we are all connected, and the downside of this is that in a recession, everybody suffers; people have less money to spend, interest rates wither, tax rates rise, and eventually, it starts to affect you and your business. On the plus side, if businesses in a strong financial position offer a helping hand (financial or otherwise) to those struggling, we will all be better off in the long term.
The financial support provided by the UK Government has saved the economy in the short term, but it’s not sustainable. It’s cost £210 billion so far and doesn’t include NHS costs and the welfare bill to support those who, despite everything, have lost their jobs. The only way to kick-start recovery is if each and every one of us takes responsibility and starts to take action now.
So if you work for a business unaffected by Covid, what can you do to help #buildbackbetter?
Finance
Payback furlough money or other government handouts. If your business has performed better than expected, don’t claim for state benefits you don’t really need or pay it back if you’ve already claimed. Ikea, Redrow and Dr Martens are just some of the bigger corporates that have led the way after six successful months of trading.
Pay as much tax as you can. Now is not the time to be guileful about your tax bill. Publish your tax payments in your annual report alongside your profit announcement, and be proud of how much you’re contributing to the UK economy
Decline payment holidays. Don’t take advantage of other payment breaks or discounts offered by mortgage lenders, landlords, energy firms, telecom companies or any other supplier unless you need it.
Support your supply chain. Equally, are there businesses you supply or buy from that you can support by buying products in bulk, paying up-front for services, waiving commission fees or offering more flexible terms in your contracts? Small adjustments to your terms of business can make a big difference.
Be more responsible with your profits. Tesco has come under fire for paying £635million in dividends to its shareholders despite benefiting from Covid tax breaks. In 2020 you should need no reminder that your stakeholders are of equal importance to your shareholders, and moves like this will do your reputation no favours.
Buy locally. Think of ways you can support local businesses. Some companies have reimbursed staff in the States for buying their coffee from local independents. Another idea could be investing in an office refurb using local suppliers.
Reconsider your payment terms. It is possible to pay suppliers within a few days, so if you take a month or more, look at the processes and systems you have in place.
People
Create new jobs. If your business is booming, don’t allow your current workforce to become overstretched and stressed. Make the most of the Kickstart scheme to create new job placements for young people and employ them locally whenever possible.
Be empathetic to your employees. Just because you haven’t been affected doesn’t mean your employees haven’t. Their partner or other family members may have been furloughed or made redundant, which will have impacted their family finances. Make time to speak to your staff about their wellbeing. When everyone is working remotely, it’s easy to miss the warning signs when someone is struggling.
Be flexible. Now more than ever, employees need companies to be flexible to juggle their work-life balance and family commitments. It’s proven that employers who offer employees more autonomy are rewarded with loyalty, commitment and increased productivity. Have faith in your recruitment process and leave any micromanagement tactics at the door.
Keep investing in CPD. Non-essential professional qualifications might seem like a drain on your finances, but if you can afford to, you should ring-fence your training budget. Not only will it improve the productivity of your staff in the short term but it will also contribute to strengthening the UK workforce as a whole.
Make time to speak to your staff about their wellbeing. Photo by JESHOOTS.COM on Unsplash
Events
Don’t cancel Christmas. If you were planning a staff Christmas party and have already budgeted for it, don’t cancel your plans completely. Think of ways to redirect the money to support other - preferably local – businesses. One way to do this is by giving your staff gift vouchers for local restaurants and experiences. They might not use them until 2021, but the struggling company will receive much-needed funds now.
Resume your corporate fundraising. Charity donations are incredibly low at the moment. Your big team fundraising event might have been cancelled, but a virtual event is a great way to keep the team motivated from home. What’s more, you can claim tax relief on any corporate donations.
Redirect your events budget. If you’ve saved money by not holding expensive corporate events, take a percentage of the budget and pay it to the organisations you would have paid to help them rebuild their business or donate it to organisations supporting hospitality workers.
Volunteering
Support the third sector. Offer your staff the opportunity to use their work skills voluntarily for third-sector organisations that support the communities most hit by the pandemic. It will provide your staff with new experiences for their CV, and it could help nurture new relationships for your business.
Help other businesses to pivot. Some of the biggest success stories in the pandemic have been businesses that have adapted and changed their offer, but not everyone has the finances or resources to do this. What do you have that could help a struggling business or person? It could be equipment, space, shared broadband, seconded staff, free training or something else. Now is the time to share your assets if you can.
For more tips, read our feature on corporate volunteering.
The private sector will always put profit first – and rightly so. It’s how our world goes around. But a big tree in a forest is proven to live for longer and be stronger when it is nourished and protected by its neighbours. Whereas a lone tree, left exposed to the elements and forced to fend for itself, won’t grow as tall or as strong and doesn’t live as long. You can’t build an empire alone; we all know that small actions make a big difference. By taking steps to support others today, you will ultimately be boosting profitability and prosperity for us all tomorrow.
How we can help
At Samtaler, we understand the importance of your social value commitment. You’re here because you care about the impact your business has on society and want to be better. We want you to succeed, and we know from experience that achieving social value requires skill, strategy, and support.
To find out how we can help send an email to hello@samtaler.co.uk
Sign up to The Social Value Files for inspiration and practical ideas to create social value for your business.
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